PayPal stablecoin PYUSD expands cross-chain territory: leveraging LayerZero to enter nine major blockchains.

PayPal's USD-pegged stablecoin PYUSD is expanding its influence by integrating with LayerZero's interoperability framework to achieve new cross-chain deployments. This launch introduces a permissionless version of the token PYUSD0 to nine new blockchains, including Tron, Avalanche, and Sei. This move marks the largest distribution of PYUSD since its debut in 2023, aiming to eliminate liquidity silos and strengthen its position in the competitive stablecoin market.

How PayPal's cross-chain stablecoin Works

PYUSD, issued by Paxos Trust Company, was initially limited to Ethereum, Solana, Arbitrum, and Stellar networks. The newly launched PYUSD0 brings the token to Abstract, Aptos, Avalanche, Ink, Sei, Stable, and Tron, while the community versions on Berachain and Flow will also be automatically upgraded. Users do not need to take any action, as all versions of PYUSD can still be exchanged 1:1 for USD.

This expansion is achieved through StarGate, a bridging service that connects over 80 blockchains. LayerZero acquired StarGate last month and used its Hydra model to extend PYUSD to these nine additional networks.

David Weber, the head of the PayPal USD ecosystem, stated: "By collaborating with LayerZero, we are able to seamlessly deliver stable value to new markets while maintaining compliance from the outset."

This permissionless design ensures that developers and users can easily transfer stablecoins across supported networks, just like wrapping tokens (such as WBTC), without incurring additional friction.

Stablecoin Competition Intensifies: PYUSD's Market Position

Analysts believe that PayPal's move may intensify competition in the $270 billion stablecoin market, which is currently dominated by Tether's USDT and Circle's USDC. According to data from CoinGecko, PayPal's stablecoin market capitalization recently reached approximately $1.3 billion, setting a new historical high. However, this still pales in comparison to Tether's $171 billion and Circle's $74 billion.

Despite its smaller scale, PYUSD is becoming an important choice for enterprises. A survey by EY-Parthenon found that 36% of responding companies are already using PYUSD, placing it ahead of competitors such as Ethena's USDe and Sky Protocol's USDS, despite these tokens reporting a larger overall market capitalization. This expansion may further drive adoption among corporate finance departments and decentralized applications.

LayerZero Labs CEO Bryan Pellegrino stated: "The US dollar is the anchor of global finance, and stablecoins are proving to be its most effective digital form. With PYUSD, we are demonstrating how borderless funds can work in practice."

Looking Ahead: Rebuilding Payment Infrastructure

Looking ahead, PayPal's broader distribution may accelerate the adoption of its new crypto services. The company recently launched PayPal Links, a peer-to-peer tool expected to support Bitcoin, Ethereum, and PYUSD transactions. If cross-chain functionality becomes widespread, this payment giant may reposition itself as not just a leader in the fintech space, but also a key infrastructure provider in the tokenized economy.

Conclusion

PayPal, through its partnership with LayerZero, is expanding its stablecoin to more Blockchains. This strategic move not only aims to increase the distribution of PYUSD but also places it at the forefront of decentralized finance and the tokenized economy. This indicates that PayPal is transitioning from traditional centralized payment models to an interconnected decentralized future. By embracing a permissionless cross-chain model, PayPal is poised to solidify its position as a fintech leader and become a key player in the new digital economy infrastructure.